20 Companies Using The Balanced Scorecard (& Why)

Strategic planning is a vital aspect of your company’s success—but when it comes to actually executing on that strategy, you might feel completely lost. If your current management system just isn’t getting you to where you need to go, it’s time for a better solution.

Introducing the Balanced Scorecard.

Introduced in the early 1990s, the Balanced Scorecard (BSC) is one of the world’s top strategic management frameworks. It combines four different business perspectives—financial, customer, internal processes, and people—to help companies understand and achieve their organizational objectives. The Balanced Scorecard does not create strategy; rather, it organizes it in a visually-friendly format.

Although the Balanced Scorecard was introduced decades ago, it's still relevant and widely used. 2CG, a strategic execution consultancy firm, has been conducting yearly surveys about the Balanced Scorecard since 2009 in an effort to better understand why and how it’s used. (You can find results from all nine of 2CG’s studies here.) Of the organizations that participated in the 2017 survey:

• 77% report that their Balanced Scorecard is extremely or very useful.
• 75% use the Balanced Scorecard to influence business actions.
• Of the 64% of organizations that have refreshed their Balanced Scorecard, the majority—71%—did so during the previous 12 months.
• The Balanced Scorecard is used by both small and large organizations: 61% of respondents had less than 500 employees, and 9% had over 10,000 employees.

These survey results show that companies using the Balanced Scorecard are consistently benefitting from it. In fact, I bet you’ll recognize many of the companies below that have integrated the Balanced Scorecard in their organization.

If you click each link, you’ll be able to read some Balanced Scorecard case studies and learn how the BSC has helped each of these organizations. Below this list, we also describe the benefits you will get from implementing a scorecard in your organization.

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20 Companies Using The Balanced Scorecard

Private Sector

Automotive:

1. Volkswagen

2. Ford Motor Company

Banking:

3. Wells Fargo

4. Citibank

5. TD Canada Trust

Energy:

6. Mobil North America Marketing and Refining (NAM&R)

Environment:

7. Veolia Water

Electronics:

8. Philips Electronics

Healthcare:

9. Sunnybrook Health Sciences Centre at the University of Toronto Hospital

Manufacturing:

10. Borealis

11. FMC Corporation

Shipping:

12. UPS

Technology:

13. Apple

14. Microsoft Latin America

Telecommunications:

15. Verizon

16. AT&T

Public Sector

Local Government:

17. City of Charlotte, NC

U.S. Government:

18. Defence Logistics Agency

19. Federal Bureau of Investigations (FBI)

Higher Education:

20. University of Virginia

How ClearPoint Strategy Can Help

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Our software ensures transparency across your organization by visualizing key performance indicators and aligning daily operations with your long-term mission. With ClearPoint, you can easily consolidate data from various business perspectives—financial, customer, internal processes, and learning and growth—into a centralized, user-friendly dashboard.

This facilitates better decision-making, helps translate high-level goals into actionable steps, and keeps your strategic plan on track. Experience the full potential of the Balanced Scorecard with ClearPoint Strategy—schedule your personalized demo today.

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5 Ways The Balanced Scorecard Can Help Your Company

1. You’ll gain transparency throughout your organization

If you were to ask team members whether they could properly describe your department’s operational strategy, chances are you’d be met with a few blank stares. Creating and implementing a Balanced Scorecard will help remedy this issue, as it provides direction on how employees can affect change and create value within their roles.

For example, envision your company’s operations as a map. The cardinal directions are the objectives, measurements, and initiatives. Without these tools, getting to your destination is going to be much trickier.

With them, your team members can have better conversations about the strategic direction your company is headed, and how they’re involved.

2. You’ll grow your bottom line by looking at other perspectives

Traditional reporting only considers the financial perspective; it fails to consider how organizational performance is also impacted by your customers, internal processes, and people (also called “learning & growth”).

Analysis of these four perspectives together will help ensure you don’t neglect areas of your company that need attention.

3. Your operations will align with your mission

Companies using the Balanced Scorecard are able to identify the factors that are hurting their business and outline a strategic change that will bring them better results.

By clarifying what you’re doing now and how those activities will differ in the future, you will have a better chance at redirecting your company toward success.

4. Your high-level goals become tangible actions

It can be difficult to think about how you’ll actually achieve high-level objectives unless they’re broken down. The Balanced Scorecard enables you to break those goals into measures, the measures into projects, and the projects into action items.

For example, if one of the objectives in your people perspective (sometimes called the “learning & growth” perspective) is to have effective managers, you might measure the percentage of key managerial goals met.

5. You’ll be able to consolidate your strategic plan

Companies using the Balanced Scorecard are usually tracking a wide variety of measures and other information. With many divisions, partners, and resellers, it can become confusing to decipher how the company is doing overall.

A BSC brings all the important data together for the leadership team to view in a centralized location, giving them a birds’ eye view of how the company is running. You can then drill down from a high level into your divisions and departments using a consistent framework.

If you want to learn more about the Balanced Scorecard (or are ready to create your own), we suggest:

• This Harvard Business Review article, authored by Balanced Scorecard creators Kaplan and Norton.
• This exhaustive Balanced Scorecard example, complete with how to read a strategy map.
• This list of 10 signs that your Balanced Scorecard strategy isn’t working, and how you can fix it.
• This detailed explanation of who should manage your organization’s BSC.

Enjoy the reading, and happy scorecarding!

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FAQ:

What are balanced scorecard perspectives?

The balanced scorecard perspectives are:

- Financial Perspective: Focuses on financial performance metrics such as revenue growth, profitability, and return on investment.
- Customer Perspective: Measures customer satisfaction, retention, acquisition, and market share.
- Internal Processes Perspective: Evaluates the efficiency and effectiveness of internal processes that drive the organization's operations.
- Learning and Growth Perspective: Assesses the organization's ability to innovate, improve, and learn, focusing on employee training, organizational culture, and technological advancement.

How is the balanced scorecard used?

The balanced scorecard is used to:

- Translate Vision and Strategy: Converts the organization's vision and strategic goals into measurable objectives.
- Align Organization: Ensures that all departments and employees are working towards common goals.
- Communicate Objectives: Clearly communicates the strategic objectives and expectations to all stakeholders.
- Monitor Performance: Tracks progress towards achieving strategic goals using key performance indicators (KPIs) across the four perspectives.
- Drive Strategic Initiatives: Guides the execution of strategic initiatives by linking them to specific performance measures.

How do you implement the balanced scorecard?

To implement the balanced scorecard:

- Define Strategic Objectives: Identify the key strategic objectives for each of the four perspectives.
- Develop KPIs: Create specific, measurable KPIs to track progress towards each objective.
- Set Targets: Establish performance targets for each KPI.
- Align Initiatives: Link strategic initiatives and projects to the strategic objectives and KPIs.
- Communicate: Ensure that the balanced scorecard and its objectives are communicated clearly across the organization.
- Monitor and Review: Regularly track performance against the KPIs, review progress, and make necessary adjustments.
- Continuous Improvement: Use insights gained from the balanced scorecard to drive continuous improvement and strategic adjustments.

How does the balanced scorecard improve performance?

The balanced scorecard improves performance by:

- Providing Clear Focus: Aligns day-to-day activities with long-term strategic goals.
- Enhancing Communication: Ensures that everyone in the organization understands the strategic priorities and their role in achieving them.
- Facilitating Measurement: Provides a structured approach to measuring and monitoring performance across multiple dimensions.
- Encouraging Alignment: Aligns resources, initiatives, and activities with the strategic objectives.
- Driving Accountability: Establishes clear accountability for achieving specific performance targets.
- Enabling Feedback and Learning: Promotes continuous feedback and learning, allowing for timely adjustments and improvements.

Why is the balanced scorecard important for an organization?

The balanced scorecard is important for an organization because it:

- Provides a Holistic View: Offers a comprehensive view of organizational performance beyond financial metrics.
- Aligns Strategy and Operations: Bridges the gap between strategic goals and day-to-day operations.
- Improves Decision-Making: Enhances decision-making by providing relevant and timely performance data.
- Drives Strategic Execution: Ensures that strategic plans are effectively translated into actionable initiatives.
- Enhances Accountability and Transparency: Clearly defines responsibilities and expectations, improving accountability and transparency.
- Supports Continuous Improvement: Facilitates a culture of continuous improvement by regularly reviewing and adjusting strategies and performance measures.